Highlighting News, Trends and Best Practices in Employee Benefits

FICA-Reduction Arrangements using Wellness Programs

Posted by Rachel Smith on Jun 23, 2016 11:27:34 AM

BEWARE OF FICA-REDUCTION ARRANGEMENTS USING WELLNESS PROGRAMS

It has come to our attention that certain arrangements are being marketed to employers that are intended to reduce an employer’s FICA obligation by significantly increasing employees’ pre-tax salary reductions. We want to caution employers against entering into these types of arrangements before having a conversation with an employee benefits attorney who understands them. This alert provides some background on these schemes and our concerns with them.

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Topics: Wellness, EmployeeBenefits, Wellness Programs, Health & Wellness, FICA